BIC Completes Acquisition OfNorwood
In a deal finalized Friday, Norwood Promotional Products LLC has formally become a subsidiary of BIC USA Inc., the parent company of BIC Graphic USA (asi/40480), creating a conglomerate that instantly becomes the largest supplier in the ad specialty industry. The total financial consideration for the acquisition was $125 million plus $37.5 million in assumed liabilities. "As companies, we have very similar visions and values," said Lori Bauer, trade marketing manager for BIC Graphic North America, in an interview yesterday with Counselor. "We're excited about the opportunity to grow our mission and culture. Right now, we're focused on providing the best service for our customers."

According to executives at both companies, BIC Graphic USA and Norwood will operate independently, with separate product lines, catalogs and management teams. In addition, as a result of the deal, no BIC or Norwood employees will be laid off and no facilities will be consolidated. "We couldn't be affiliated with a better company," said Norwood CEO Paul Lage. "It's business as usual for us. All our programs and promotions are still in place."

As first reported on June 19, BIC outbid the presumed purchase front-runner, Aurora Resurgence, which had made an initial offer to buy the Indiana-based supplier two months ago. Aurora's first purchase offer was around $130 million, which was trumped by BIC's total bid of $162.5 million. At a recent three-party bidding session, BIC beat out both Aurora and Norwood's lending group, comprised of its secured creditors. The auction occurred roughly six weeks after Norwood filed for Chapter 11 bankruptcy protection, announcing that it could not restructure its $200 million debt. "With this deal, we can get back to some normalcy," said Lage, who left BIC in 2006 to become Norwood's president. "We're very proud of the way we've sort of reinvented the company over the last three years."

For a period of time after Norwood's bankruptcy filing, Lage admits his company's sales slipped 7%-10%. However, since the acquisition announcement involving BIC, Lage says Norwood has seen "a noticeable uptick in business." Bauer says BIC's sales have also increased in conjunction with the purchase of Norwood. "We're very optimistic about the remainder of this year," she says. "The feedback has all been positive."

While BIC and Norwood will remain separate companies, their combined revenues should easily outpace industry competitors. In 2008, Norwood reported sales of $314 million, while BIC reported sales of $191 million. "As companies, we have an expectation to become industry leaders with better quality, better service and thorough product safety," Lage said. "Our strengths complement each other."

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Video Report: State Of The Industry Sneak PeekCounselor is putting the finishing touches on its annual State of the Industry issue – set to be released on July 21 – but to whet your appetite we have a video series planned for the next few weeks that will give you a sneak peek at the vital stats and information in the issue. In this second installment, we look at some ways that distributors can improve their workplace culture – and motivate employees – during a difficult economy.

Also, on July 15 Counselor will be hosting a Webcast titled Sneak Peek: Best Business Building Strategies From Counselor's State of the Industry. The live event will take place from 2pm eastern time to 3pm eastern time and will look at sales, marketing and business operations strategies sure to help lead industry companies to success for the remainder of this year. Register now by clicking here.

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American Apparel Accused of Using Illegal Workers
As first reported in a Breaking News Alert last week, American Apparel (asi/35297) has been told by the United States government that 1,800 of its employees are working illegally in the U.S. The supplier, whose founder Dov Charney has been a vocal advocate of immigration reform, is one of hundreds of companies that are being investigated by Immigration and Customs Enforcement in a new effort by the Obama administration to catch illegal workers.

The immigration agency sent notice to the Counselor Top 40 supplier that 1,600 of its employees submitted suspect documentation. The eligibility of another 200 workers could not be verified due to discrepancies in their records. "It is the company's hope that these employees are able to confirm their work authorization so that they may continue to work at American Apparel," Charney said in a prepared statement.

In a press release, American Apparel said that if the workers – representing nearly a third of the Los Angeles-based supplier's workforce – could not provide proper documentation, "the employees will not be able to continue their employment." The supplier revealed the notice from the government in a filing with the Securities and Exchange Commission. The government's findings were the result of an inspection conducted by the immigration agency in January of last year. The Los Angeles Times reported that among the infractions were fake social security numbers used by some of American Apparel's employees. In its release, American Apparel points out that the "notice provided no indication that American Apparel knowingly or intentionally hired any unauthorized immigrants."

The supplier says employees will be given a "reasonable timeframe" to resolve their immigration status. Even if it were to lose all the employees in question, American Apparel believes that its current surpluses of inventory and production capability will mitigate any major effects, financially or otherwise. The notion is supported by Todd Slater, an analyst at Lazard Capital Markets who follows American Apparel. "This is likely to be more of a human-interest story than one affecting the ability to make enough garments," Slater wrote in a note to investors. "[It] should have no impact on earnings."

Charney – a Canadian immigrant himself – and his company have a history of outspoken activism regarding immigration reform. American Apparel has conducted a campaign called "Legalize L.A." that supports the legalization of undocumented workers, and the CEO has continually touted his company as a sweatshop-free organization. "The company remains very proud of its track record as an advocate for the comprehensive reform of the country's immigration laws," said Charney in the press release.

The new government crackdown audited 652 companies (many of them in New York and California) to determine if their employees were eligible to work. Companies in violation could be subject to fines as well as civil and criminal charges.

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ASI Internet Radio Live On The AirEvery Tuesday morning from 10:30am eastern time to 11:00am, a team of ASI editors debate the most important topics facing the industry. We also, of course, offer our own off-beat look at the market. This morning, we shared some new statistics from the Counselor State of the Industry report, discussed creative ways to avoid layoffs and talked about one of the hottest markets for distributors these days (hint: animals are involved). And, we even took callers from new distributors looking to find out some ways to improve their businesses.

If you missed the show, don't worry. A recording is now available at www.asicentral.com/radio. And, don't forget to join us next Tuesday, July 14, for our next broadcast. Log on to www.asicentral.com/radio at 10:30am eastern time and give us a call at 215-953-4979.

Declining Advertising Forecast Issued for 2009
A new global advertising forecast is predicting an even steeper decline in 2009 than it originally anticipated, though it also foresees a mild recovery globally in 2010. Zenith Optimedia offered a revised forecast yesterday that predicts global ad spending to decline by 8.5% this year – an even sharper drop than its original prediction of 6.9% "Faced with extreme uncertainty, advertisers in most sectors planned for the worst and cut their costs in anticipation of steep drops in revenue," the Zenith report says.

At the same time, however, the report writers believe the worst will soon be over this year for advertising. "For all sectors the shape of the rest of the year is becoming clearer," the Zenith report observes. "Q2 was not quite as tough as Q1, and we have held our expectations for the rest of the year steady, as signs emerge that the downturn is approaching its nadir."

Zenith believes that the Internet will be the only ad medium to demonstrate growth this year, while television, cinema and outdoor advertising are set to decline less than the overall market. The report forecasts over 10% in growth for internet advertising, and says the Internet could account for over 15% of all advertising spending by 2011 (in 2008 it constituted 10.5% of all spending). "Most of this growth will come from paid search, which is an ideal method of reaching consumers looking for bargains," the report said.

The Joe Show: Summer Cleaning In this episode of The Joe Show, Counselor Managing Editor Joe Haley cleans out his new-product closet and shows off some of the most interesting new items that suppliers have sent him. Looking to offer clients some of the market's latest items? Check out this episode of The Joe Show.

Hirsch International Signs Acquisition Agreement
Hirsch International, a provider of equipment and support services to the graphic and decorated apparel industry, announced that it has signed a definitive agreement to be acquired by Paul Gallagher, the company's current president and CEO. The agreement calls for Gallagher to pay $.31 per share in cash for the company. The price represents a premium of approximately 48% over Hirsch's (NASDAQ: HRSH) closing share price of $0.21 on June 12, 2009, the last completed trading day prior to the public announcement of Gallagher's offer to acquire all of the company's outstanding shares. Gallagher's initial offer was for $.28 per share for all of the outstanding shares.

Hirsch's board of directors announced that it has approved Gallagher's acquisition offer and is recommending that the company's remaining stockholders approve the deal, as well. Gallagher has received a financing commitment from Keltic Financial Services LLC to fund the deal.

Hirsch says that as part of the agreement, it can still solicit bids for the company for another two weeks. It expects, though, to close the transaction with Gallagher in "approximately three months." The company says it won't have any further comment at this time. The Hirsch stock price is up more than 15% since the deal was announced.

Rate The Counselor Power 50 And Make New NominationsCounselor is now compiling its Power 50 list for 2009 – our recognition of the industry's most influential individuals – and we're looking for feedback from you. Click here to see the list of last year's Power 50 and let us know whether you think the members are more or less influential today than they were a year ago. Or, if you know of someone who should be on the list but isn't, please write his or her name and company information in the space provided. Also, make sure to include a reason why you think the nominee belongs on this year's Power 50 list. We look forward to your input.

Register forFREE ASI Webinars!Log on to ASI's Educational Webinars, where ad specialty professionals go to stay informed about the latest trends and business acumen in the marketplace today. Choose from a variety of courses offered to help distributors and suppliers increase sales and grow profits, manage operations and expand the services you provide. Register for these upcoming Webinars at ASICentral.com/webinars.

R.S. Owens & Co. (asi/75530) announced that it has recognized Zach Koenig with its first ever Employee of the Quarter Award.

Starline (asi/89320) is holding a win a Nintendo Wii contest for distributors. For rules and more information, go to: www.starline.com.

Trophy.com (asi/92239) announced that it has changed its name to RMI Awards (asi/80271).

TSC Apparel (asi/90518) has announced the latest winners of its Wildcard Advantage promotion, awarding trips to the 2010 PPAI Las Vegas show. The second quarter winners are: Platinum T's, Gadsden and Zoink Inc.

Vitronic Promotional Group (asi/93990) has become the exclusive industry supplier of Totes brand umbrellas. The new line will debut at the ASI Show Chicago.

People On The MoveAdventures in Advertising (asi/109480) has added two new owners to its network. They are: Cathey Cort, AIA/AdsUp, Placerville, CA and Nancy Varner, AIA/C'est Bon Creations LLC, Seattle, WA.

CleggPromo (asi/45450) announced that it has hired Rico Munoz and Derrick Blanchette as inside account executives.

Corvest Awards Free Shipping All Summerasi/91530 - Win free self promos or free shipping…guaranteed! Barker Specialty Company in Cheshire, Connecticut won FREE domestic shipping ALL SUMMER. What will you win? Play now to find out! View Special...

FREE REGISTRATION DEADLINE FORASICHICAGOHAS BEEN EXTENDED TO THIS FRIDAY — JULY 10

Excitement for The ASI Show Chicago, July 21-23, is growing with thousands of distributors already registered to attend the largest show of the summer. In fact, due to popular demand the free registration deadline for ASI distributor and decorator members has been extended to this Friday, July 10.

As the biggest event to visit the Midwest, ASI Chicago will deliver 700 leading suppliers, over 50 top-notch education workshops (sponsored by Fields Mfg., asi/54100), a free Keynote by branding expert Harry Beckwith and around-the-clock networking — including an exclusive evening cruise on the Spirit of Chicago (cruise sponsored by SnugZ USA, asi/88060; Crystal Gardens Reception sponsored by Corvest: Adva-Lite, Toppers, It’s All Greek To Me) taking place Wednesday, July 22.

ASI Chicago will also feature the acclaimed New Distributor Success Track created for those new to the ad specialty industry. Attendees who participate in at least three classes from this track on July 21 will receive a FREE ASI Distributor Success System — a 10 CD (plus introductory DVD) crash course to achieving success in the advertising specialty industry. (A $199 value!) Click here for a preview.
Register for ASI Chicago today at www.asishow.com. Or, call 877-ASI-SHOW with any questions. ASI distributor and decorator members can receive up to $100 toward a hotel room.
Follow The ASI Show on Twitter and become a fan of The ASI Show page on Face book today!

The ASI Holiday & Incentives Expo, taking place September 15-17 at the Sands Expo Center in Las Vegas, is the industry’s first and only national trade show focused on products for the important fall and holiday selling seasons and the place to preview all that is new for 2010.

Featuring suppliers with four or more stars in the ASI Supplier Ratings System; free education focused on corporate gifts, incentives and recognition programs and hot new apparel items; along with around-the-clock networking, the ASI Holiday & Incentives Expo will deliver a top-notch sales-producing event. Two free Keynotes will include an exciting program entitled Secrets from the Pros: Cash in on the $45 Billion Incentive Marketon Thursday, September 17, at 8:30 a.m.This informative, panel discussion led by ASI Vice Chairman Matthew Cohn, will cover key trends and selling tactics in this growing industry.

Plus, members can purchase discounted tickets to the award-winning musical, The Lion King— new to Las Vegas! Visually stunning, technically astounding with a musical score like no other, The Lion King is sure to keep you on the edge of your seat.

Register today at www.asishow.com for the ASI Holiday & Incentives Expo. ASI distributor and decorator members can enjoy free admission and up to $100 toward a hotel room.

The following are the dates and locations for The ASI Show in 2009:
Chicago: July 21-23
ASI Holiday & Incentives Expo, Las Vegas: September 16-17